I am LoudRex a.k.a. Rik from the Netherlands.
I am very new to forex and now trading for a week.
I really understand the candlesticks, and now want to get more into the forex world by understanding a Relative Strength Index indicator.
I read somewhere that someone sets the RSI on 1 day to get a better view of the defined market i.e. EUR/USD.
But a 1 day time chart doesn’t move too often.
And I am trading with only 1 a 2 euros per trade to get started, so there is almost no movement with my time chart set to one day.
So after all, what is for smaller traders the best settings for RSI and time chart??
I hope you’ll can help me out.
Kind Regards,
LoudRex
PS. My RSI is standard set by IQOption (my forex broker), 14 candels, 30 under, 70 over.
For some more confusion, when the opportunity presents it’s self I use a scalping strategy with settings of 2 period, 90/10 inputs, on a 1 minute time frame. When price goes over 90 I sell, when it goes below I0 I buy sell. I only trade certain pairs at certain times. This is not about risk reward this is about overall making more than losing
To be clear, this is the same as my intra day strategy; All systems work sometime…But no system works all the time. Always Manage Risk.
In my opinion choosing timeframe also will depending our trading style, if we prefer to trade for long-term strategy, or we have long-term plan trading, hence we can using daily timeframe to figure out and reading the trend, but indeed need more patience to waiting RSI reached overbought oversold area, but if we prefer work as intraday trading, I think we can use RSI on H1 timeframe
Those are Simple Moving Average and Exponential Moving Average. It give you a sort of averaged out line on your chart to help you plot average movements in Price over a period of time.
In terms of RSI, I use it on my Daily charts for my End Of Day trading, I also do have it on my 240 and Hourly charts, but it for me carries less weight on those, so I don’t take it as seriously.
But in my view these are all questions which come slightly further in your trading life. If you have only been trading a week, personally I would strongly advise you simply to pull up ‘naked’ Price charts, ie charts with no indicators on them, and get very familiar with them. Then maybe throw on a Moving Average or something to help you along, or manually draw on some Support and Resistance lines. But really start by staring at charts for hundreds, thousands of hours. Loading up on RSI and Moving Averages etc from the outset risks clouding the message. It is the chart you are trading, so get familiar with the chart first and how it moves and when it moves. Add some aids in later if you still feel you need to.
Instead of looking for someone to give you a fish; you will be better off learning how to fish. The babypips school will tell you exactly the difference and anything else. If you go to the school, you’ll not only know the difference, you’ll be able to tell which one will help you in your style of trading.
Okay, thank you for your worthy info @SimonTemplar.
I think I preserve my balance left on my Real money account and start with trading with demo money.
I already lost about 17,5 % of my deposit…
Okay the deposit was 10 euros but still…
I use this as well from time to time with 95 - 5 settings, This is an effective scalping system, newbies should at the very least trial this on a demo, and trade it with discipline. DON’T open a position until it crosses back toward the 50 from the overbought 90 / oversold 10 line.
Even try it on a 50 Tick Chart (~1 min) for smoother candle formations.
You’re welcome. It doesn’t hurt necessarily to lose a handful of Euros early - it reminds you that this is real! But yes, I think refining your technique in demo is a solid start to any trading approach. When I went live, I lost several of my early trades. I’m still here, years later, so it does get easier if you stick with a patient, methodical approach, and always know why you are doing what you are doing.
Should I use on of these indicators SMA, EMA or RSI?
Because I don’t know how to look if a forex pair goes up or down.
How can I see that on candlesticks without indicators???
SMA= Simple Moving Average & EMA= Exponential Moving Average. Yes, these are additional type of Moving average, you can get these parameters on the settings section of Moving Average.
Mate, I got your point! And I really appreciate it since I have no intention to copy others strategy or anything like technical tool. I was just curious, nothing else.
Have you gone through the babypips school? I know you mentioned you’re new to fx and have been trading for a week. Was just wondering how you’ve been educating yourself.
And SMA and EMA give you slightly different info (an EMA is slightly weighted to more recent Price movements), so no one can really tell you which is best for you. It’s a personal thing! Someone else recommended doing the BP School. That’s great advice, all 313 lessons of it. It’s packed with great stuff. If it feels like too much effort then trading isn’t really for you anyway.
